Itaú bba – scenario review – uruguay_ fiscal adjustment is postponed to 2017


• Economic activity remains weak, and the fiscal deficit is widening. Us dollar to british pound exchange rate The government is working on a tax package equal to 1% of GDP that would go into effect in January 2017. Yen to usd exchange rate We now expect fiscal deficits of 4% of GDP in 2016 and 3% of GDP in 2017 (up from 3% and 2.5%, respectively, in our previous scenario).

• Standard and Poor’s (S&P) has revised its outlook for Uruguay to Negative from Stable. The futures market explained The rating agency is concerned about the evolution of the fiscal accounts and public debt.

• Inflation picked up again in May, reaching 11% yoy. World stock market futures live We have increased our 2016 and 2017 inflation forecasts to 10.8% and 9.8%, respectively, from 10% and 9% in our previous scenario.

Uruguay’s fiscal deficit came in at 4% of GDP in April, up from 3.6% in March. Pln to usd Although tax revenues increased by 19.5% yoy , weak results from public companies led to lower growth in total revenue (10.1% yoy), which amounted to a drop in real terms. Gpb to usd On the other hand, primary spending rose by 33.9% yoy, boosted by transfers, salaries and pension payments. Hkd to usd chart Debt interest increased to 3.8% of GDP in April, up from 3.6% in March.

The government announced a USD 460 million fiscal adjustment (1% of GDP). Funny jokes for kids The package, yet to be approved by Congress, consists of a USD 335 million revenue increase and a USD 125 million expenditure cut. Cnn stock market futures The package would go into effect next year, not in 2016. Usd inr exchange rate live On the revenue side, the personal income tax rate for higher-income taxpayers would increase by 6 pp, to a maximum of 36%, and social security contributions would also rise. Hex to binary converter online Meanwhile, expenditure would be curbed by limiting the salaries of public officials and the inflationary adjustments for certain spending categories and investments. Exchange rate usd cad The government has maintained its target of bringing the fiscal deficit down to 2.5% of GDP by 2019, when the government’s term is set to end.

The fiscal plan drew some criticism within the governing coalition before being submitted to Congress. Decimal word problems 5th grade Eventually, low-income Uruguayans were exempted from the proposed tax increase. Binary exercises A broader public debate is now in store. Uk to usd converter The country’s public accounts are worsening due to weak economic activity (which has an impact on revenue), the poor performance of public companies and rising expenditure. Stock market futures monday We now expect fiscal deficits of 4% of GDP this year and 3% of GDP in 2017 (up from 3% and 2.5%, respectively, in our previous scenario). Future stock market cnn Uruguay’s gross public debt had already risen by 5% at the end of 2015, to 47.8% of GDP, due to fiscal deterioration (and a contraction of GDP in dollars). Usd cny We expect further increases in gross public debt, to 54% of GDP this year and to 58% at the end of 2017.

In early June, S&P revised its outlook on Uruguay to Negative from Stable, while affirming its BBB/A-2 foreign and local currency sovereign credit ratings for the country. Rose quotes shakespeare The credit rating remains two notches above investment grade. Dow futures exchange S&P highlighted that the revision reflected the risk that weaker-than-expected growth could lead to a continued decline in GDP in USD terms, weakening Uruguay’s creditworthiness. Binary calculator The agency also noted that low growth could compromise the government’s plans to further strengthen the country’s revenue base, reduce the general government deficit and stem the rise in government debt. Usa today crossword puzzle Fitch also recently called attention to the evolution of Uruguay’s fiscal accounts, but it did not change its outlook on Uruguay’s sovereign credit rating (BBB-, Stable).

Consumer prices climbed by 0.97% mom in May, accelerating from a 0.46% mom gain in April. Usd exchange rate Annual inflation rose to 11.0% in May from 10.5% in April. Eur usd forward rates Inflation now stands at its highest level since October 2003. Decimal to binary algorithm The May inflation figure reflected an increase in food prices (4%), particularly for vegetables, as a result of heavy rains. Rmb usd exchange rate Non-alcoholic beverage prices increased by 2%, household expenditure went up 2.4% and apparel prices rose by 1.4%. Hockey shooting drills Year-end inflation expectations climbed to 10.1% in May from 10% in April and remain above the target range set by the central bank (3%-7%).

Reducing inflation is becoming increasingly challenging, particularly because the recent acceleration has occurred while the peso has been strengthening. Python tutorial for kids The BCU tightened its monetary policy in May, increasing reserve requirements for deposits in both pesos and dollars and reducing the annual growth target for the monetary aggregate, M1. Gold price usd When the inflation rate surpasses 10%, the government can summon the National Wage Council to discuss possible adjustments in public administration (for the private sector, the inflation trigger is 12%). Usd yen forecast We have increased our 2016 inflation forecast to 10.8% from 10.0%. Binary hexadecimal For 2017 we now expect an inflation rate of 9.8%, up from 9.0% in our previous scenario.

In May, the nominal exchange rate appreciated for the third consecutive month. Dollar and pound exchange rate The exchange rate ended May below 31 pesos to the dollar, easing pressure on the BCU. Call option The monetary authority sold USD 600 million in 1Q16 to contain exchange-rate pressures. Eur usd exchange rate We now expect stronger currencies in Brazil and Argentina, in line with our new scenario of low interest rates in the U.S. Market futures for tomorrow (we now expect one rate hike in the second half of 2016, instead of two). 256 in binary Therefore, we have reduced our 2016 exchange rate forecast to 34 pesos to the dollar (from 35 previously). Usd rmb exchange rate history But we are leaving our 2017 exchange rate forecast at 38 pesos to the dollar, as we believe that the peso has yet to regain competitiveness against its trading partners.

The CERES activity index suggests a contraction in economic activity in 1Q16 and is showing negative signs for 2Q16. 1 usd to inr today The index fell by 0.5% mom in March after remaining stable in February. Live futures market In April, the employment rate and the activity rate fell to 58.1% and 63.2%, respectively, compared with 59.4% and 64.6% the previous year. Binary coder These contractions reflect the sluggish labor market. Futures market explained The unemployment rate hit 8.1%, while consumer confidence fell by 16.2% yoy. Sftp binary mode Manufacturing industry production plummeted by 7.4% in April, thereby accumulating a 0.7% yoy drop over the first four months of the year.

Our 2016 GDP growth forecast stands at 0.6%. Binary explained For 2017, we forecast 1.2% GDP growth. Future stock market A possible transition to a La Niña weather pattern this year could affect our forecasts, not only due to the impact it may have on primary activity but also due to its potential effects in nearby countries.

In April, exports fell by 39% yoy, while imports rose by 3% yoy. What is the binary system The drop in exports was due to lower shipments of primary goods and manufacturing goods (-74% and -21% yoy, respectively). Us exchange rate to canadian dollar Regarding imports, we noticed a one-off factor: while purchases of consumer goods and intermediary goods fell (following the trend seen in previous months), capital imports rose by 87% yoy, essentially due to purchases of machinery and equipment by the private sector (+126% yoy). Gold background images Therefore, the monthly trade balance deteriorated significantly in April (USD -322 million, compared with USD -4.9 million in April 2015), increasing the 12-month trade deficit to USD 1 billion. Usd nzd We continue to forecast a trade deficit of USD 1 billion for both 2016 and 2017.